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Can a high-yield savings account replace your 401(k)?

investing ideas :: 2025-02-18 :: source - yahoo finance

By Sarah C. Brady

Yahoo finance / Getty images

Questioning where to keep your retirement savings? With a volatile stock market, you may be wary of putting your hard-earned money into investments that can lose value. Meanwhile, a high-yield savings account (HYSA) can offer a safe, reliable return. Today, the best HYSAs pay above 4%.

However, you could lose out in a big way if you go with a bank account over an employer-sponsored retirement account. Why? Even if you contribute to an HYSA with a competitive interest rate, your earnings won't match the average returns you get on a 401(k). Plus, you miss out on other benefits like the ability to reduce your tax bill.

Story continues through Yahoo finance


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